What Happened?
Shares of IT distribution giant TD SYNNEX (NYSE: SNX) jumped 5.3% in the afternoon session after the company reported third-quarter results that surpassed analyst expectations and provided a strong forecast for the fourth quarter.
Revenue for the quarter came in at $15.65 billion, up 6.6% year on year and ahead of estimates. The company's adjusted earnings per share of $3.58 also beat consensus by a notable 17.5%. The positive results were complemented by an optimistic outlook. Management guided for fourth-quarter revenue of $16.9 billion at the midpoint, which was 6% above what analysts were expecting. Similarly, the adjusted earnings per share guidance of $3.70 at the midpoint was also above Wall Street's forecasts. Overall, it was a strong quarter for TD SYNNEX, with beats on both the top and bottom lines, along with better-than-expected guidance.
The shares closed the day at $159.75, up 6.3% from previous close.
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What Is The Market Telling Us
TD SYNNEX’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 6 months ago when the stock dropped 18.1% on the news that the company reported weak first-quarter 2025 results with sales, operating profits, and earnings all falling short of Wall Street's expectations. Its revenue guidance for next quarter missed significantly, and its EPS guidance for next quarter fell short of Wall Street's estimates. Additionally, cash flow was a weak point during the quarter. TD SYNNEX reported negative free cash flow of $790 million, compared to a positive $344 million a year ago, a reversal that could raise concerns about operational efficiency or working capital management. Overall, this was a weaker quarter.
TD SYNNEX is up 37.1% since the beginning of the year, and at $159.69 per share, has set a new 52-week high. Investors who bought $1,000 worth of TD SYNNEX’s shares 5 years ago would now be looking at an investment worth $1,248.
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